Fanatics, the online retailer of licensing sports products, just received and influx of cash from the NFL, the NFLPA and MLB. The investment roughly values the company at $3.17 billion. The company’s revenue was $1.4 billion last year. The investment shows that leagues and investors see the company’s business model as the future of reaching fans and selling them merch.
Fanatics has been at this for a while. Their amazing ability to connect with fans and sell shirts, hats, and basically anything fans can wear has allowed the company to grow to amazing heights. It’s a one stop shop where fans can get gear that may not be easy to find anywhere else. Want swim trunks that have a team’s logo? Fanatics has it. How about a button up shirt that has the team’s mark plastered all over it? They got it.
Fanatics has been working closely with decision makers for a while. They have gear that isn’t sold at stereotypical online retailers and probably wouldn’t sell enough units to make it worth a brick and mortar store to hold on to the inventory. The business model works. They can quickly turn things around and in the age where everything has a short self life, the nimble abilities of Fanatics shine through.
On-demand merchandise is going to continue to grow. If a player says something that’s noteworthy they can slap it on a t-shirt in no time. New fashion movements and styles are also available. The speed that Fanatics turns things around is what makes them a good investment.
They are also building interaction with fans in different ways. There are player specific pages that let fans see Spotify playlists. It’s not just about merchandise. It’s about content. That means Facebook Live interviews, work with player’s associations and snackable videos. All things that Fanatics has been doing for some time.
The investment will allow the leagues and players’ associations a chance to influence the retailer and benefit from the upside of the growing marketplace.